(Learning Objective 2, 3: Determining ending inventory and cost of goods sold—

FIFO vs. LIFO) MusicLife.net specializes in sound equipment. Because each inventory item is expensive, MusicLife uses a perpetual inventory system. Company records indicate the following data for a line of speakers:

❙ Requirements 1. Determine the amounts that MusicLife should report for cost of goods sold and ending inventory two ways:

a. FIFO

b. LIFO 2. MusicLife uses the FIFO method. Prepare MusicLife’s income statement for the month ended April 30, reporting gross profi t. Operating expenses totaled €340, and the income tax rate was 30%.